Participants will be in listen-only mode during the conference, and later on we'll start the Q&A session when further instructions will be given. We also inform that this conference will be conducted in Portuguese by the management of the company, and the conference call in English will be made by simultaneous translation. This event is also being broadcast simultaneously on the Internet via webcast. Before proceeding, we would like to clarify that statements that may be made during this call regarding business prospects of the company, projections and financial and operating goals, are based on assumptions and beliefs of Cyrela's management as well as on information currently available to the company. Forward-looking statements are not guarantee of performance, and they involve risks, uncertainties and assumptions. They refer to future events and therefore depend on circumstances which may or may not occur.
Investors should understand that general economic conditions, industry conditions, and other operating factors may affect the future results of the company and lead to results that differ materially from those expressed in such forward-looking statements. Now I would like to turn the floor over to Raphael Horn, who will start the presentation. Mr. Horn, you may continue.
Good morning, everyone. In a challenging scenario, both in a global and local context that we had in the second half of 2021 continues a trend. Despite that, we continued with a good solid result during 2022. Despite the seasonality of the beginning of the year, the launched PSV was 146% higher than the first quarter of 2021, exceeding BRL 1 million with project Wave in Rio de Janeiro, with 82% of units sold.
Pre-sales of BRL 1.3 million, 27% up from the first Q 2021. As a result of operating revenue, we had net revenues of BRL 1.2 million and gross margin ending at net income. We have a strong balance sheet. Despite the complex scenario, we'll have a solid cash generation. Let's talk about operating results now.
Thank you, Raphael. Good morning, everyone. On slide five, we would like to comment on the launches of Cyrela. In the first quarter of the year, we have launched six new products with a PSV of BRL 1 billion. 146% above the same quarter of previous year, and 59% lower than the fourth quarter of 2021. The participation of the company in the product launched was 59% or 85%.
On slide six, we highlight the launch of Wave in Rio de Janeiro, with 82% of units sold in the quarter. On slide seven, let's speak about the sales performance. In the quarter, sales reached BRL 1 billion, with a reduction of 17% when compared to this fourth quarter of 2021. An increase of 27% against the same quarter of last year. Including swaps, sales reached BRL 1 billion, and the PSV of Cyrela. The state of São Paulo accounted for 59% of our sales. On slide nine, we talk about the total inventory of Cyrela. At the end of the quarter, the market value inventory reached BRL 7.215 billion. A reduction of 3% with regard to the previous quarter, driven by the sales in the period. The movement of our inventory can be seen on the chart on the left.
On slide 13, we talk about financial results. Net revenue of the company reached BRL 1.2 billion in the quarter. 7% lower than 4Q 2021, and 23% higher than the same quarter of the previous year. The gross margin in the first quarter was 31.1%, compared to 33.4% in the previous period, and 34.5% in the same quarter of 2021. We've had a net income of BRL 162 million compared to BRL 192 million in the first Q 2021, and BRL 218 million in the 4Q 2021. Slide 14 talks about our profitability. In the quarter, our return on average equity in the net income of the last twelve months over equity was 13.7%.
On slide 15, we talk about the debt. The gross debt at the end of the quarter added to BRL 3.576 billion. With a cash position of BRL 3.2 billion, our net indebtedness was BRL 334 million. Total gross debt, 81% is long-term. Our net debt over equity is 4.8%, 0.7 percentage points above previous quarter. On the next slide, we'll talk about cash generation. In the first quarter of 2022, we had a cash burn of BRL 53 million compared to the cash generation of BRL 100 million in the fourth Q 2021, and generation of BRL 17 million in cash in the first quarter of 2021. Now, Raphael and I will move on to the Q&A session. Thank you.
Thank you. We'll now start the Q&A session. To ask a question, please press star nine. If your question is accepted, after being announced, you'll hear a notice to type star six to open your microphone. Please do it once only. Question in English will be only received in writing. The first question come from Elvis Credendio from BTG Pactual. Mr. Elvis, you may continue.
Hello, can you hear me?
Good afternoon. Yes, we hear you.
Good afternoon, everyone. First question is about sales. I know that it's been a very good quarter on sales with many launches. I would like to know how are sales in the first half of the second quarter, if it's in line with the company's expectations. The second question is more related to construction costs, because we've heard about the new increase in steel prices. Last week, we heard some news about that, a high increase. I would like to know what are your prospects regarding that topic and the company. I was thinking about reviewing something that was not conforming. That's the question. Thank you.
Hello, Elvis. This is Raphael speaking. Well, I believe that in sales, so far, so good. What we are launching and selling within expectations. About construction costs, Miguel will speak about it. Wave was a very important launch for us in Rio de Janeiro. As we said, the result of the gross margin was low because it's a high spec. But our OE is excellent and sales really surprised us. You know, they were very good. We're very happy with the outcome.
As for our construction costs, Elvis, good morning. As you said, the pressures are high. We had a 12.5% adjustment to wages in addition to some increase in inputs that are important in our ABC curve. We had an impact of BRL 21 million in our results due to budget reviews. It's hard to say how it's going to be for the future. It depends on how much because the actual variation of prices sometimes is higher in the input than the INCC or the inflation rate, and sometimes not. We understand that the main budget reviews have already happened in our understanding.
Okay. Thank you very, very much.
The next question comes from Fanny Oreng from Santander.
Yes. Hello?
We hear you.
Oh, great.
Good afternoon.
Good afternoon, Raphael, Miguel. My question is about Rio de Janeiro. I think this launch you made in Rio really caught our attention because it's a high quality launch. Rio de Janeiro, there have been so little launches. How do you see the pipeline of launches for Rio de Janeiro? Would it make sense to increase your position in Rio considering the number of companies that are already maturing the investment they made in the past? What could you do to improve that area?
Fanny, this is Miguel speaking. Yes, in fact, Wave was very successful. It's important to highlight that's not something we can copy because there's zero competition. It's, you know, looking at the ocean line, so it's very hard to find land in the south area of town. We do not have so many plots of land in our pipeline. Actually, at Barra neighborhood, we didn't do much. We did, starting in 2020, we launched projects, but they did very well. It's a difficult market because it's limited in size, but we've been successful. Towards the future, we'll try to replicate that strategy as much as possible.
Okay, thank you. Wonderful, Miguel. Thank you for your answer.
The next question comes from Aline Caldeira from Bank of America.
Hello, everybody. Can you hear me?
Yes. If you could speak a bit louder, though, it would be good.
Good morning. Thank you for your question. How do you see the competition? If you could share your strategy about that.
Hello, Aline. How are you? In cash, it's according to schedule. It's a small company. It's on a day after day. It's interesting. In the competitive dynamics, it's as usual. Every market there is competition in every market, and it's up to us to do something new. That's it. Just the everyday usual business.
Okay, wonderful. Thank you.
The next question comes from Pedro Hajnal from Credit Suisse .
Good afternoon. Can you hear me? Yes, we can. Thank you for the question and presentation. I have two questions. First, I would like to understand more about margins for the rest of the year. You mentioned that maybe this dynamic would be different, but there was an impact on this quarter by you. Without considering this project that Wave by YOO , at what levels would be margins? If this dynamic will continue towards the end of the year. Second question, I would like to understand more about the cash burn. Could you give us some more color of what were the main reasons for it?
Pedro, thank you for the questions. First, regarding Wave by Yoo , the margin of the quarter would have been 1.2 percentage points higher than the gross margin reported, not adjusted. 32.3%, if I'm not mistaken, and the partner was one or two percentage points on margin. It's worth highlighting to make it clear for everybody the effect that the swap creates. This project has a 24.9% margin, which is lower because of the swap, which was higher. If we maintain the current prices, the margin would be 29%, but it has a spectacular managerial reserve for us.
We do not take into account the swap revenues as being our swaps, but this margin has a margin of 24%, which is much higher than our minimum of 16.5%. It's 48%, which is very high, and it's already cash positive in the month of launch. We had very little capital exposure, and the return would be very high. This is a very successful project. We're very pleased with it. In accounting terms, it does have a bit lower gross margin. The gross margin in the quarter was impacted by the construction costs as well, a little bit more than one percentage point and by Wave. Comparing to last year, there was a positive effect of INCC, which pulled margins up. This year, we may have something like that.
On the other hand, launches of the year had a gross margin of 34%. In the next quarters, go up. If margins go up, the margin of this quarter was lower because the launch was lower because of Wave, then higher margins will be reported. It would depend a lot on the price dynamics and our capacity to recompose margins on the next launches. 'Cause we believe that the gross margin of the year will be a bit higher than this one for the first quarter, although lower than that of 2021.
Thank you, Miguel. As for cash generation.
Oh, yes. I'm sorry. I forgot about that. The cash burn was BRL 50 million in this quarter compared to BRL 100 million of cash generation in the fourth quarter. The two main variations were, first, more displacements of land, BRL 200 million of dispersed land compared to BRL 100 million in the fourth Q 2021. Also this fourth quarter, we had a lot of dividends received. Dividends from Lavvi, Cury and CCP, of which we have a small stake. Since dividends received were a considerable amount, that generated an impact. These two factors explain the difference from the fourth quarter to this quarter. We believe that this year there will be a cash burn. This figure, the first quarter is completely within our expectations.
Perfect. Very clear. Thank you very much, Miguel, and good afternoon, everyone.
The next question comes from André Mazini from Citibank. André, you may continue.
Okay. My question is about the speed. Could we expect this figure for the rest of the year too? Or let's say there's no compensation or the compensation of people could impact that. Thank you.
André, good morning. Well, there is some 60% in May, 20% June, 20% July. There is a ceiling of compensation for salaries. I think it's BRL 6,000. After that, it's a fixed amount. That decreases, but on the construction side, it's a small impact, which is most of our labor. The impact is significant on the compensation on the budget of the construction.
Our next question comes from Marcelo Motta from JP Morgan.
Good morning. Good afternoon.
Good afternoon, Motta.
Two questions. You had mentioned on the SG&A of CashMe. Do you plan to keep it at the same level for each quarter of the year? When we think about the increase in prices of the units, looking at the grid of inventory variation compared to the total inventory, the adjustments of price increase seems very marginal considering the inflation rates we have. We'd like to understand. Maybe this quarter was a bit lower than expected. What was the reason for that? Thank you.
Thank you for the questions, Motta. As for CashMe, the GMA is mostly or almost all of it recurring. We, in fact, made the operation more robust. We have 340 employees now, and we needed a stronger structure to face the growth that we imagine for the company. That's why SG&A is within our expectations. Also, we have been able to grow the portfolio considerably. As for pricing, we have been able to transfer prices in most of our projects.
We adjust our price table by INCC every month. Sometimes we make some specific adjustments to projects, but this line can also be adjusted by advances. It's nominal. If the customer anticipates payment somehow, it may seem like a change in prices, but it's just a change in the payments, flow of payments. When we see that, the speed of the sales. Oversupply is suffering a bit with prices, we make some adjustments to keep it in a healthy level.
Okay, thank you.
Next question comes from Bruno Mendonça from Bradesco.
Thank you for the question. Follow up on the margin, if you could give us some more detail. Because we saw the margin impacted by a project. What the half margin of the quarter, where is it offset to make it so stable looking forward, you know?
Thank you, Bruno, for your question. The gross margin in this quarter has dropped a bit when compared to the fourth quarter. The main reason was Wave. Wave reduced this margin by 30 basis points. Other than that, it would have been 36.8% without Wave. The gross margin has a positive effect from inflation, because with inflation, we have more trade receivables than incurred costs, construction costs to be incurred. The gross margin does not translate the margin that will be posted in the balance sheet because there are also some accounts, such as interest, that are not taking into account in the gross margin. We've had it stable, partially because except for Wave, launches have had a healthy margin at launch time, and inflation also contributes to that.
Okay. Congratulations. Thank you.
This concludes the Q&A session. I would now like to turn the floor over to Miguel Maia Mickelberg for his final comments.
We thank you all. We know that the scenario has been challenging, but we've done our best to navigate through it, and we've been able to provide a good performance, and we'll do work even harder from now on. Thank you very much and have a good afternoon.
Thank you. Cyrela's conference call for the first quarter of 2022 has now ended. Have a good afternoon.